CHIA Certification Exam with Complete Solution 2023.

CHIA Certification Exam with Complete Solution 2023. Corporate hotel -Answer- A chain hotel owned or managed by the chain or the parent company Franchise hotel -Answer- A chain hotel run by a 3rd party where the chain receives some sort of franchise fee Independent hotel -Answer- Not affiliated with a chain or parent company Of the 3 basic types of hotel operations (corporate, franchise, and independent), which one has the most US properties? Which one has the least? -Answer- Most=Franchise Least=Corporate Of the 3 basic types of hotel operations (corporate, franchise, and independent), which one has the most worldwide properties? Which one has the least? -AnswerMost=Independent Least=Corporate What is the ratio of chain hotels vs. independent hotels in the US? -Answer- 70% are chain; 30% are independent What is the ratio of chain hotels vs. independent hotels worldwide? -Answer- 40% are chain; 60% are independent Management company -Answer- Operates a hotel for another party; the company has a management contract where it receives payment/some portion of profits T/F Some chains or parent companies manage their own hotels -Answer- True Owner companies -Answer- There are many companies that own multiple hotels Asset management company -Answer- Represents the owner in the operation of a hotel T/F A hotel cannot have both a management company and an asset management company -Answer- False. They can. T/F The Holiday Inn and Holiday Inn Express are 2 different chains -Answer- True What are the 3 classifications of operation types? -Answer- 1. Corporate 2. Franchise 3. Independent T/F There is a very strong trend for US hotels to expand internationally because the opportunity for large US chains is there -Answer- True Describe the average independent hotel in the US -Answer- Classified as Economy, Located in a Suburban area, and has 25 rooms or less Most of the entities below are classified as chains. Which one is a parent company consisting of multiple chains? A. Hampton Inn B. Motel 6 C. Choice D. Holiday Inn Express -Answer- C. Choice Which is a true statement about parent companies? A. They and their related chains have changed over time B. They must consist of no more than 5 chains. C. They can only consist of chains in a single Scale. D. They can only have hotels in a single country. -Answer- A. They and their related chains have changed over time Which is a true statement about independent hotels? A. Independent hotels are not affiliated with a specific chain. B. Chain hotels outnumber independent hotels in every country of the world. C. Independent hotels are mostly Luxury class hotels in Urban locations with more than 150 rooms D. Independent hotels may never be managed by an outside entity. -Answer- A. They're not affiliated with a specific chain. Which is a true statement about management companies? A. They have contracts where they receive payment for their services and/or some portion of the profits. B. They may manage only one chain. C. They will always own the hotels they manage. D. They serve the exact same role as asset management companies. -Answer- A. They have contracts... What are the major geographic categories? -Answer- World Continent Sub-continent Country Market Tract or Submarket What are the 4 continents (according to STR)? -Answer- Americas, Europe, Mideast/Africa, and Asia Pacific Each continent includes how many sub-continents? -Answer- 3-4 What are the 9 US regions? -Answer- New England Middle Atlantic South Atlantic East North Central East South Central West North Central West South Central Mountain Pacific What are the 2 most important types of classifications if you're a hotel manager (not a corporation)? -Answer- Market and Tract/Sub-market What is STR's definition of a region? -Answer- It refers to a specific region WITHIN a country How are markets created? -Answer- Based on the number of hotels in the area and participation The US is broken up into _____ geographic areas called markets -Answer- 163 T/F Markets can cross state borders -Answer- True There are _____ tracts in the US -Answer- 628 Revisions to markets and tracts are made at the _______. -Answer- end of the year (after Dec. and before Jan.); changes are not made during the year Tracts -Answer- Geographic sub-divisions of a market There may be anywhere from ___ to ___ tracts in a market -Answer- 2-10 In a metro market, there is usually a tract from the downtown area, sometimes called the _________ -Answer- Central Business District Outside of North America, the term ______ is used instead of Tract. -AnswerSubmarket What are the revisions to markets and tracts based upon? -Answer- -Supply (new hotels opening) -Participation (new hotels submitting performance data) -Client feedback T/F STR uses the UNWTO definitions when it comes to recognizing countries -AnswerTrue T/F No market will ever cross country borders -Answer- True What are the 7 Scale categories? -Answer- 1. Luxury chains 2. Upper upscale chains 3. Upscale chains 4. Upper midscale chains 5. Midscale chains 6. Economy chains 7. Independents What is the average ADR for Luxury chains? -Answer- $300 What is the average ADR for Economy chains? -Answer- $50 What is the average ADR of the Independent Scale group? -Answer- $100 T/F When a chain is categorized in a specific Scale group, that means every hotel in that chain is in that Scale group everywhere in the world, in every country and market. - Answer- True Chains are positioned in Scale groups based upon what? -Answer- ADR How are chains sorted by their ADR amount? -Answer- From high to low T/F Breakpoints between Scale groups stay the same every year -Answer- False. They may move up and down slightly from year to year What's the difference between Class and Scale categories? -Answer- The class category has no "independent" class group; so there's only 6 class categories, instead of 7 How do Independent hotels fit into different Class categories? -Answer- They're slotted into the Scale categories (Luxury through Economy) at similar ADR levels T/F Chain hotels are always in the same Class as Scale. -Answer- True. A Ritz-Carlton will always be in the Luxury class group since it's in the Luxury Scale group Class is used globally, but is especially popular where? -Answer- Outside of North America where there are more independent hotels When are independent hotels grouped into Classes? -Answer- At the beginning of the year based on the annual data for the prior year What is the ADR range for Luxury chains? -Answer- $150-$220 What is the ADR range for Upper Upscale chains? -Answer- $120-$150 What is the ADR range for Upscale chains? -Answer- $100-$120 What is the ADR range for Upper Midscale chains? -Answer- $85-$100 What is the ADR range for Midscale chains? -Answer- $70-$85 What is the ADR range for Economy chains? -Answer- $55-$70 Urban area -Answer- Large metro cities Suburban area -Answer- The suburbs of metro cities Airport area -Answer- Close to a major airport Interstate area -Answer- Close to a major highway Resort area -Answer- Primarily leisure destination hotels Small Metro/Town area -Answer- Smaller metro areas T/F Extended stay is a Scale category -Answer- False Typical guests of extended stay hotels stay _____ night(s) -Answer- 4-7 T/F A single hotel can be categorized as multiple types -Answer- True What are the Type categories used by STR? -Answer- All Inclusive All Suite B&B/Inn Boutique Condo Conference Convention Corporate Housing Destination Resort Timeshare Boutique hotels -Answer- Properties with rooms and public spaces that offer unique, contemporary, and distinctive design/decor Boutique hotels generally have an estimated room rate of _______ and ______ rooms - Answer- $175 or higher; fewer than 200 rooms Destination resorts appeal to what kind of traveler? -Answer- Leisure travelers There are ___ destination resorts in the US -Answer- 334 What is benchmarking in the hotel industry? -Answer- Individual hotels compare their performance to the performance of a "competitive set" of hotels Competitive set -Answer- A group of hotels used primarily for comparison against a subject property for performance benchmarking purposes How are comp sets used? -Answer- -Benchmarking -Aids the sales and marketing dept. -Used in management contracts for performance requirments (often determines managers' compensation) -Used for internal and external analysis Hotel staff historically performed _______, where they would talk to staff from competitive hotels -Answer- "call arounds"; They also used to count cars in parking lots or windows with lights on _________ means finding the averages based on the data from a group of hotels so that each individual hotel is protected from exploitation of their specific data -AnswerAggregating What is the most recent case that involved anti-competition actions? -Answer- 5 La Quinta hotels in Conneticut in April 2010 When are comp sets created? -Answer- They're created by the time the hotel opens. Sometimes they're created long before the hotel opens while it is still under construction. that way the new hotel staff can track the performance of the comp set prior to the opening of the hotel Who are the stakeholders when choosing a comp set? -Answer- -Management company -GM -Chain company -The sales and marketing team What are the 4 P's you must think of when deciding upon a comp set? -AnswerParticipation Proximity Pricing Product Participation means 4 different types of data. What are they? -Answer- Monthly Daily Segmentation (many hotels submit Rooms Sold and Revenue broken down by Transient, Group, and Contract) Additional Revenue (some hotels submit Food and Bev and Other Revenue in addition to Room Revenue) T/F When it comes to Class (and Scale), higher end hotels tend to select competitors that are below them in their Comp Set and vice versa. -Answer- True What are the key elements of Product (when choosing a comp set)? -Answer- Number of Rooms Open Date Hotel Type Meeting Space Amenities What is the first rule in creating comp sets? -Answer- Sufficiency. In North America, comp sets must include 3 or more hotels in addition to the subject (though they're encouraged to have at least 4 or more). Outside of North America, comp sets must include 4 or more hotels in addition to the subject. Explain the rule of "percentage checks" when creating comp sets. -Answer- Help to ensure that the data of a single hotel, chain, or company is not isolated. Comp set rule: No single property or chain can account for more than ____% of the total participating room supply of a comp set (____% outside of America). -Answer- 40%; 50% Comp set rule: No single company can account for more than ____% of the total participating room supply of a comp set. -Answer- 60% The average number of hotels in a primary comp set is between ____ -Answer- 5-6 Explain the "Nameback" percentage -Answer- In the US, only 45.13% of the properties in your primary comp set name you in their primary comp set Explain the "Reverse Comp Set" -Answer- The specific properties that name your hotel in their comp set The avg. US hotel is named as a competitor by ____ hotels that aren't in its comp set - Answer- 2.8 Why are comp sets changed? -Answer- -Changes in the subject hotel (i.e. renovation, new management, contract changes, etc.) -Changes in the market (i.e. new competitive hotels open) -Strategic changes (i.e. repositioning, improving comp set strength) When are comp sets changed? -Answer- You can change your comp set at any time, although many people wait until the beginning of the year What are the rules related to changes that address "isolation" issues (comp sets)? - Answer- -If a property wishes to change their comp set, they must do so by a net change of 2 or more properties -If only making a change with 2 properties, both must be in a different chain, parent company and management company from the subject hotel What are the exceptions to the "change rules" for comp sets? -Answer- -A hotel can add a brand new property which has been open less than 6 months -A hotel can remove a property from its comp set that has stopped participating after 3 months What does a Trend Report show? -Answer- Performance information (5+ years) for a potential set of competitive hotels What does a "One-time Run" show? -Answer- Less performance information (18 months) for a potential comp set in the form of a STAR report